What is Growth Hacking?

There are few phrases more misunderstood than growth hacking. Coined by entrepreneur and investor Sean Ellis in 2010, the term refers to a form of marketing that is geared towards the rapid, short-term growth of a young company. The word “hack” is used because the tactics involved will often rely on a mixture of creativity, technical application and a low-budget, “guerilla” approach.

Whilst growth hackers will utilize both “tactical” and “sustainable” methods (as shown in the graph above), it’s important to understand that growth hacking is not marketing in the traditional sense. Though there is a degree of similarity and overlap, there are also several key differences. Whereas marketers are concerned with the broad, long-term goals of building and maintaining a company’s customer-base, every decision that a growth hacker makes will be fueled by a desire for growth, whether it’s sustainable or not. Have a look at this interesting infographic from Direct Spark for a visual representation of these distinctions.

To illustrate, some specific examples of tactics commonly favored by growth hackers are listed below. Though they may be used by marketers after the initial growth period, they are often unsustainable in the long-term and their application will usually be markedly different or eclipsed by “higher-level” strategies.

Close attention to analytics to target customer drop-off points in the sales funnel so they can quickly be “sealed”.

Leveraging of the product itself as a marketing tool to encourage referrals (many gaming apps, for instance, will offer rewards for sharing scores on social media).

Engaging target audiences on third party platforms platforms like Udemy, Quora and Reddit

Focusing on the production of content that has strong potential to go viral (rather than to maintain engagement with the current user-base).

Offering sign-up incentives, free giveaways and short term discounts.

Partnering with bloggers and thought-leaders for free publicity.

Targeting low-competition keywords in content to rank in search engines.

Interestingly, growth hacking began in the technology and digital spheres and it’s common for growth hackers to have a technical background. Success stories are most common with online startups and below are four examples of now-established companies that have used growth hacking to huge effect:

Airbnb – In its early stages, the people behind Airbnb used Craigslist to reach out to people advertising a spare room and asked them to advertise on their site. They were eventually banned but it made a great short-term growth strategy, one that increased their customer-base substantially and provided revenue for more long-term marketing.

Dropbox – By focusing almost exclusively on one strategy, that of offering free upgrades in exchange for customer referrals, Dropbox grew into one of the largest cloud-storage companies in the world.

Appsumo – Appsumo launched a series of social media giveaways which, in addition to highly-targeted ad spending, generated a huge number of sign-ups to their mailing list.

Twitter – Surprisingly, Twitter’s stand-out success is in part attributable to growth hacking. Informed by speedy data insights, developers tweaked the product in a variety of ways to engage initial customers, such as encouraging them to follow five accounts when they signed up.

Anybody thinking about hiring a “growth team” for their startup should bear in mind that traditional marketers often make poor growth hackers. Their thinking and approach is usually fundamentally different. First off, growth hackers tend to have a “T-Shaped skillset” which allows them to work as part of a small team whilst being proficient with a range of marketing channels. Secondly, the impetus is much more on creativity – of spinning tried-and-true marketing principles in new and innovative ways to spur product adoption.

A marketing degree may prepare somebody for running promotional campaigns at a high level. It rarely teaches them, however, to spam Craigslist. And sometimes, that’s exactly what’s needed.